NMHC 50 Methodology

The National Multifamily Housing Council (NMHC) partners with Kingsley Associates to handle the NMHC 50 survey process, although NMHC remains solely responsible for any errors. To compile the NMHC 50 lists, both organizations gather names of owners, managers, developers, general contractors and syndicators from as wide a range of sources as possible and contact staff from each firm that completes the survey online. Over the years, improved outreach and increased publicity associated with the rankings have resulted in more firms responding to the survey.

For the purposes of this survey, investment fund managers are treated as owners only if they retain substantial equity in the apartment property or if they maintain effective responsibility and decision making over the investment property. When firms function strictly as advisers rather than investors, they are not regarded as owners. In the past, tax credit syndicators and franchisers were regarded as owners if they retained a fiduciary responsibility. This year we have introduced a new list just for syndicators.

The rankings are unable to distinguish between partial and full ownership. Some firms own sizable apartment properties through joint ventures in which their share could range anywhere from 1 percent to 99 percent. Others are primarily the sole owners of their apartments. In principle, it would be desirable to account for partial ownership—treating 50 percent ownership of 100 apartments as equivalent to full ownership of 50 units, for example. In practice, it is not feasible to make such distinctions.

The survey excludes condominiums, cooperatives, hotel rooms, nursing homes, hospital rooms, mobile homes and houses with rental units. Rental housing for seniors (age-restricted apartments) is included, although assisted living and congregate care facilities are not. Both student housing and military housing are included (measured by units, not beds). Finally, since industry concentration is measured by comparing the top 50 owners and managers against the nation’s entire apartment stock, only U.S. apartments are included.

At times, a firm may debut on the NMHC 50 at a high level. Generally, this means the firm is responding to the survey for the first time, rather than an indication of an outsized portfolio gain—although that, too, happens on occasion. Nonetheless, despite many improvements and everyone’s best efforts, the process remains imperfect because it relies on both accurate reporting and surveying of the complete universe, both of which can be fraught with problems.

There are two caveats in comparing the lists over time. First, beginning in 2017 syndicators are no longer considered owners, so that the 2017 list is not meaningfully comparable to those of previous years. This wasn’t the first time the definition of ownership has changed: in 2006 we refined the definition to eliminate those investment fund managers with neither substantial equity nor effective control over the investment property. (Note: Neither of these changes affected the management list.) Second, occasionally firms that have previously been among the top 50 owners or managers have not responded to the NMHC survey. When that occurs, companies appear on the list that otherwise might not have been large enough. These adjustments affect the total number of apartments owned by the top 50 firms, as well as other measures of concentration such as the mean and median portfolio size. For these reasons, year-to-year comparisons must be made with great care.